Chancery Denies Motion to Dismiss Claims for Breach of Fiduciary Duty in Connection with Merger

Frank v. Elgamal , C.A. No. 6120-VCN (Del. Ch. March 30, 2012). See summary of prior Chancery decision in this matter highlighted on these pages . Issue Addressed Whether it was premature to rule on a fiduciary duty claim based on the entire fairness standard, at the motion to dismiss stage...

The Other Kind of Merger-Related Litigation

Much has been written recently (including on this blog) about the growing prevalence of M&A related litigation. These lawsuits, typically launched by the target company shareholders, are filed shortly after a merger announcement and usually object to some aspect of the proposed merger or of the...

China's Antitrust-Merger Authority Handling of the Google-Motorola Deal

Excerpt: This past February the US Department of Justice ("DOJ") and European Commission ("Commission") cleared Google Inc.'s acquisition of Motorola Mobility Holdings Inc. without any conditions. In contrast, on May 19, 2012 the Chinese Ministry of Commerce ("MOFCOM"...

M&A Transactions and Antitrust Risk

The antitrust risk is on the buyer to take agreed steps to obtain antitrust approvals, and some of the risk is allocated to the seller by allowing the parties to walk away from the deal if the most extreme risks materialize. This article outlines the top ten techniques for understanding, evaluating...

Delaware Court of Chancery Agrees with Fiat on Formula to Buy Chrysler Shares

Fiat North America, LLC v. UAW Retiree Medical Benefits Trust , C.A. No. 7903-VCP (Del. Ch. July 30, 2013) [ an enhanced version of this opinion is available to lexis.com subscribers ]. Issue Addressed : How to interpret the formula in the call option agreement to determine the price for Fiat to purchase...

M & A Begins to Roar

Lately it’s been reported that mega-mergers are coming back in a variety of industries. We have waited quite awhile for this to happen. We hope that will also begin to trickle down to the middle and lower middle market of deals. There are pluses and minuses for the economy when M&A gets...

Reps and Warranties Insurance: Why You Need It

In recent years, the uptake for M&A representations and warranties insurance has increased. Just the same, even now, the participants in the M&A transaction often do not always fully understand what they need to know about the insurance. In particular, some transaction parties don’t always...

In re Trados: What Happens When Common Gets Nothing?

On August 16, Delaware Chancery Court Vice Chancellor Laster issued his highly anticipated, post-trial decision in In re Trados Incorporated Shareholder Litigation , C.A. No. 1512-VC (August 16, 2013) [ an enhanced version of this opinion is available to lexis.com subscribers ], where the directors who...

No Fraud Exception for Countrywide Litigation

The Delaware Supreme Court just issued its opinion in response to a certified question posed to it by the Ninth Circuit in the Countrywide shareholder litigation. The question posed to the court: Whether, under the “fraud exception” to Delaware’s continuous ownership rule, shareholder...

Don't Sue A North Carolina Board Of Directors Over A Merger Without Reading This Case

Last week's Order in Gusinsky v. Flanders Corp ., 2013 NCBC 46 [ an enhanced version of this opinion is available to lexis.com subscribers ], should be required reading for lawyers thinking of suing the directors of a corporation in North Carolina over a merger transaction. It provides guidance on...

Delaware Supreme Court Lifts Injunction; Allows Vivendi/Activision Deal to Proceed

Activision Blizzard Inc. v. Hayes et al. , No. 497-2013, order issued (Del. Oct. 10, 2013). In a rare ruling from the bench, after oral argument, the Delaware Supreme Court reversed an injunction granted by the Court of Chancery in Hayes v. Activision Blizzard Inc., No. 8885, 2013 Del. LEXIS 519 (Del...

TRO Halts Boston Globe Sale

Uh-oh... a crisis just a day before the World Series! As you may remember, the NY Times agreed to sell its Boston Globe division to John Henry, the principal owner of the Red Sox. Owning the local newspapers, obviously, makes for excellent coverage when it comes October and your team IS PLAYING IN THE...

DOJ to Drop Antitrust Case If US Airways, American Give Slots to Low-Cost Carriers

WASHINGTON, D.C. — (Mealey’s) The U.S. Department of Justice (DOJ) on Nov. 12 proposed a final judgment with US Airways Group Inc. and American Airlines Inc. under which the DOJ would drop its merger antitrust lawsuit against the airlines if they divest slots and gates at key constrained...

U.S. Supreme Court Denies Stay of American Airlines Merger With US Airways

WASHINGTON, D.C. — (Mealey’s) U.S. Supreme Court Justice Ruth Bader Ginsburg on Dec. 8 denied an emergency application by individual airline customers seeking to prevent the merger of bankrupt American Airlines Inc. and US Airways Group Inc. The customers had argued that the merger violates...

Delaware Court of Chancery Allows Claims for Post-Closing Earn-Out Iniquities and Inequities

American Capital Acquisition Partners, LLC v. LPL Holdings, Inc., C.A. No. 8490-VCG (Del. Ch. Feb. 3, 2014) [ an enhanced version of this opinion is available to lexis.com subscribers ]. This Court of Chancery opinion addresses a recurring theme of many cases in this court: disputed earn-out provisions...

Comcast Merger Raises Questions, but Any Answers?

It's no surprise that the proposed Comcast-TWC merger raises questions about consolidation in the cable business. But it's hard to say that there are any simple answers. The issues that are raising some of the loudest concerns stem from the fact that this merger will be a merger of number 1 and...

Delaware Court of Chancery Denies Motion For Summary Judgment on Merger Challenge

Frank v. Elgamal , C.A. No. 6120-VCN (Del. Ch. Mar. 10, 2014) [ an enhanced version of this opinion is available to lexis.com subscribers ]. Why this case is noteworthy : For many readers, this 94-page decision on a motion for summary judgment is useful, in part, for the following points: One...

Delaware Court of Chancery Allows Some Claims to Proceed in Connection with Merger

Chen v. Howard-Anderson , C.A. No. 5878-VCL (Del. Ch. April 8, 2014) [ an enhanced version of this opinion is available to lexis.com subscribers ]. Why this Case is Noteworthy : This Delaware Court of Chancery opinion addresses the standard of review applicable in a merger that is challenged on Revlon...

Cornerstone Releases 2013 Study of M&A Lawsuit Settlements

Only two percent of M&A lawsuit that settled in 2013 involved a monetary payment to shareholders, according to the latest report on M&A lawsuit settlements from Cornerstone Research. The report, entitled “Settlements in Shareholder Litigation Involving Mergers and Acquisitions: Review of...

Go-Shops and the Pricing of Going Private Transactions

Antoniades, et al have a paper, No Free Shop . There have always been two sides to the go-shop issue. On the one side, if a company has the right to proactively shop itself post-signing, that should be good, right? In Topps , Chief Justice Strine called the go-shop "sucker's insurance"...

Watergate Is Not Just a Hotel – Corporate Suitors for Alstom

Today is the anniversary of an event that can truly be said to have changed the world; although certainly not in the manner intended by its planners, sponsors or participants. Today is the anniversary of the 1972 Watergate Break-In. How much of the world has changed because of this event? We certainly...

Summer of the Inversion, Continued

See Summer of the Inversion, Part 1 , which includes a video explainer on inversion deals So, inversions are continuing in rapid fashion. Even Mylan - whose CEO is the daughter of West Virginia Senator and former Governor Joe Manchin (see: " what my daughter did should be illegal ") I've...

Walgreens: High Water Mark For Inversions?

Walgreens had been working on and considering an inversion for some time, but today it dropped plans to relocate to the UK and announced that it would purchase all of the shares of Alliance Boots (UK) that it did not already own. Does Walgreens' decision to step away from the inversion edge mark...

What's Driving Inversions?

That question is still a bit of a mystery. Still no real answer, but like the SAT test we can start to eliminate the obviously wrong answers. From a paper by Ed Kleinbard, Competitiveness Has Nothing to Do With It (h/t Dealbook ), we can eliminate the competitiveness canard. Here's the abstract:...